News of the FBI probe into Clinton emails spooks the market Friday afternoon.

The broad market closed moderately lower Friday, as the announcement of the FBI probe into Clinton emails injected new uncertainty into the market. The benchmark index SPX closed down -6.63 points at 2126.41, or -.31%. However, the index did recover well off the low of the day which was 2119.36.. SPX logged a weekly loss of -.7%, so a pretty flat week despite the intra-day volatility.

Below is the open position status:

SPX Weekly Iron Condor

This position was opened on Friday, October 28. Position details below:

SOLD SPX November 4 2175 Call, 1.10 credit.

BOUGHT SPX November 4 2185 Call, .50 debit.

SOLD SPX November 4 2075 Put, 2.15 credit.

BOUGHT SPX November 4 2065 Put, 1.50 debit.

Order was filled as an "Iron Condor" for $1.25 net credit (all four legs).

Margin/Risk is calculated by the width of the wings ($1,000), less credit received.

Margin/Risk for this week's trade: $875.

Target Gain: 7% of margin/risk or $60.

Max loss: 10% of margin/risk or $85.

Below is the risk graph as of the close Friday:

SPX November 4 Iron Condor:

We came close to having the stop loss trigger (set at $2.10) at the low of the day, but it was not hit. The position is currently -$20 as of the close; the debit to exit is $1.45 according to Think or Swim. The position is flat delta and nicely centered going into next week, so it should recover if volatility comes out a bit and the market is calm. Our order remains in place to exit for target gain when the debit reaches $.65, or if the max loss reaches 10%. However, I do recommend exiting the position regardless of the status prior to the FOMC meeting announcement Wednesday afternoon. This news usually creates market volatility which could cause a move against the position with very little time to recover.

Below is the SPX chart indicating the short strikes:

SPX 6 month chart

The CBOE's volatility index jumped up 5.4% at the news yesterday afternoon, closing at 16.19 which is the highest in 1-1/2 months. Below is the 6month chart:

VIX 6 month chart

Next week's economic news, highlighted by the FOMC meeting and announcement Wednesday afternoon, is summarized below:


8:30 am Personal Income & Outlays

9:00 pm China Manufacturing PMI report


FOMC Meeting Begins

9:45 am PMI Manufacturing Index

10:00 am ISM Manufacturing Index

10:00 am Construction Spending


8:15 am ADP Employment Report

10:30 am EIA Petroleum Status Report

2:00 pm FOMC Meeting Announcement


8:30 am Jobless Claims

8:30 am Productivity & Costs

10:00 am Factory Orders

10:00 am ISM Manufacturing Index


8:30 am Employment Situation Report

8:30 am International Trade

For those unfamiliar with the strategies we trade, the trade management guidelines for all the Couch Potato Trader plays were most recently published on August 20, 2015, and can be found here: Link to Articles

Trade updates will be posted as appropriate.

As always, stay keen on your risk management and trade carefully,

Dot Hazlin